Page 88 - MA12

Ratio Analysis 4.33

Net Operating Profit
(n) Operating Profit Ratio = ¥ 100
Revenue from Operations

` 6,00,000
= ¥ 100 = 30%.
` 20,00,000
Note: Net Operating Profit = Gross Profit – Operating Expenses + Operating Income
= ` 8,00,000 – ` 2,00,000 + NIL = ` 6,00,000.
Or
= Revenue from Operations – Cost of Revenue from Operations
– Operations – Operating Expenses
= ` 20,00,000 – ` 12,00,000 – ` 2,00,000 = ` 6,00,000.

Unsolved Questions

1. From the following Balance Sheet of Paper Products Ltd., calculate Debt to Equity Ratio:

BALANCE SHEET
as at 31st March, 2019
Particulars Note No. `
I. EQUITY AND LIABILITIES
1. Shareholders’ Funds
(a) Share Capital 2,50,000
(b) Reserves and Surplus 50,000
2. Non-Current Liabilities
Long-term Borrowings 4,50,000
3. Current Liabilities
(a) Trade Payables 50,000
(b) Other Current Liabilities 25,000
Total 8,25,000
II. ASSETS
1. Non-Current Assets
(a) Fixed Assets
(i) Tangible Assets 4,00,000
(ii) Intangible Assets 1,00,000
(b) Non-Current Investments 1,75,000
2. Current Assets
(a) Inventories 50,000
(b) Trade Receivables 75,000
(c) Cash and Bank Balances 25,000
Total 8,25,000